-- Record quarterly revenue of $21.6 billion, up 7% year-over-year
-- Non-GAAP operating profit of $1.3 billion, $0.37 earnings per share
-- GAAP operating profit of $1.2 billion, $0.33 earnings per share
-- Cash flow from operations of $2.4 billion
HP today reported financial results for its second fiscal quarter ended April 30, 2005. Second quarter revenue increased 7% year-over-year to $21.6 billion.
Non-GAAP(1) operating profit was $1.3 billion, with non-GAAP diluted earnings per share (EPS) of $0.37, up from $0.34 in the prior-year period. Non-GAAP diluted EPS and non-GAAP net earnings for the second quarter reflect a $107 million adjustment on an after-tax basis, or $0.04 per diluted share. GAAP operating profit for the second quarter was $1.2 billion. GAAP diluted EPS was $0.33 per share, up from $0.29 in the prior-year period.
Q2 FY05 Q2 FY04 Y/Y
--------- --------- ---------
Revenue (billions) $21.6 $20.1 7%
Non-GAAP operating margin(1) 6.1% 6.7%
GAAP operating margin 5.4% 5.7%
Non-GAAP diluted EPS(1) $0.37 $0.34 9%
GAAP diluted EPS $0.33 $0.29 14%
"HP had a solid quarter," said Mark Hurd, HP chief executive officer and president. "We grew revenue 7%, non-GAAP earnings per share rose 9% and we generated $2.4 billion in cash flow from operations.
"Nevertheless, our overall performance leaves room for improvement in many of our businesses. We expect to provide details as soon as our plans are finalized that will move us toward that objective."
During the quarter, on a year-over-year basis, revenue in Europe, the Middle East and Africa grew 10% to $9.1 billion, in Americas grew 4% to $8.8 billion and in Asia Pacific grew 9% to $3.6 billion. On a consolidated basis, when adjusted for the effects of currency, second quarter revenue grew 4% year-over-year.
Personal Systems Group
Personal Systems Group (PSG) revenue grew 6% year-over-year to $6.4 billion, with unit shipments up 12%. On a year-over-year basis, desktop revenue increased 1% and notebook revenue grew 10%. Revenue for commercial clients, which includes workstations, grew 3% over the prior-year period, while consumer clients revenue grew 10%. PSG reported an operating profit of $147 million, or 2.3% of revenue, up from a profit of $44 million in the prior-year period.
Imaging and Printing Group
Imaging and Printing Group (IPG) posted quarterly revenue of $6.4 billion, up 5% year-over-year. On a year-over-year basis, consumer hardware revenue increased 3%, with unit shipments up 13%. Commercial hardware revenue grew 8%, with unit shipments up 12%. Color laser unit shipments increased 96% year-over-year and MFP shipments increased 61%, reflecting continued momentum in key growth initiatives. Supplies revenue grew 4%. Operating profit was $814 million, or 12.7% of revenue, down from a profit of $952 million in the prior-year period. This reflects $71 million in workforce reduction costs, hardware pricing actions, hardware growth and mix shifts within supplies.
Enterprise Storage and Servers
Enterprise Storage and Servers (ESS) reported revenue of $4.2 billion, up 6% over the prior-year period. On a year-over-year basis, industry-standard server revenue increased 12%, business-critical systems (BCS) revenue grew 2% and networked storage revenue was down 6%. Within BCS, revenue in HP Integrity servers grew 37% year-over-year and HP-UX revenue grew 9%. ESS reported operating profit of $184 million, or 4.4% of revenue, up from a profit of $119 million in the prior-year period. Included in the quarterly results is $24 million in workforce reduction costs.
HP Services
HP Services (HPS) revenue grew 14% year-over-year to $4.0 billion. On a year-over-year basis, Managed Services revenue grew 27%, Technology Services grew 11% and Consulting and Integration grew 10%. Operating profit was $292 million, or 7.3% of revenue, down from a profit of $332 million in the prior-year period. Included in the quarterly results is $74 million in workforce reduction costs.
Software
Software reported quarterly revenue of $277 million, an increase of 23% year-over-year, with revenue in HP OpenView and HP OpenCall increasing 36% and 4%, respectively. Software reported an operating loss of $6 million, compared with a loss of $52 million in the prior-year period.
Financial Services
HP Financial Services (HPFS) reported revenue of $544 million, up 16% year-over-year. Finance volume, a leading indicator of future revenue, grew 4% over the prior-year period, and net portfolio assets grew 2% year-over-year to $7.1 billion. Operating profit was $58 million, or 10.7% of revenue, up from a profit of $35 million in the prior-year period.
Asset management
Inventory ended the quarter at $6.5 billion, down $656 million sequentially and up $191 million year-over-year. Accounts receivable increased $601 million sequentially and $736 million over the prior-year period to $9.3 billion. HP's dividend payment of $0.08 per share in the second quarter resulted in cash usage of $233 million. In addition, HP utilized $618 million of cash during the second quarter in connection with stock repurchases. HP exited the quarter with $14.5 billion in gross cash, which includes cash and cash equivalents of $14.4 billion and short- and certain long-term investments of $0.1 billion.
Outlook
HP estimates Q3 FY05 revenue will be in the range of $20.3 billion to $20.7 billion, with non-GAAP earnings per share in the range of $0.29 to $0.31. This excludes after-tax costs of approximately $0.03 per share from amortization of purchased intangible assets and approximately $100 million, or $0.03 per share, in workforce reductions.
More information on HP's quarterly earnings, including additional financial analysis and an earnings overview presentation, is available on HP's Investor Relations website at www.hp.com/hpinfo/investor/.
HP's Q2 FY05 earnings conference call is accessible via an audio webcast at www.hp.com/hpinfo/investor/financials/quarters/2005/q2webcast.html.
About HP
HP is a technology solutions provider to consumers, businesses and institutions globally. The company's offerings span IT infrastructure, global services, business and home computing, and imaging and printing. For the four fiscal quarters ended April 30, 2005, HP revenue totaled $83.3 billion. More information about HP is available at www.hp.com.
(1) All non-GAAP numbers have been adjusted to exclude certain items. A reconciliation of specific adjustments to GAAP results for this quarter and the prior periods is included in the table below titled: "Non-GAAP Consolidated Condensed Statements of Earnings." A description of HP's use of non-GAAP information is provided under "Use of Non-GAAP Financial Information."
Use of Non-GAAP Financial Information
To supplement HP's consolidated condensed financial statements presented on a GAAP basis, HP uses non-GAAP additional measures of operating results, net earnings and earnings per share adjusted to exclude certain costs, expenses, gains or losses it believes appropriate to enhance an overall understanding of HP's past financial performance and also its prospects for the future. These adjustments to HP's GAAP results are made with the intent of providing both management and investors a more complete understanding of the underlying operational results and trends and the company's marketplace performance. For example, the non-GAAP results are an indication of HP's baseline performance before gains, losses or other charges that are considered by management to be outside of the company's core business segment operational results. In addition, these non-GAAP results are among the primary indicators management uses as a basis for planning and forecasting future periods. The presentation of this additional information is not meant to be considered in isolation or as a substitute for net earnings or diluted earnings per share prepared in accordance with generally accepted accounting principles in the United States.
Forward-Looking Statements
This press release contains forward-looking statements that involve risks, uncertainties and assumptions. If the risks or uncertainties ever materialize or the assumptions prove incorrect, the results of HP may differ materially from those expressed or implied by such forward-looking statements and assumptions. All statements other than statements of historical fact are statements that could be deemed forward-looking statements, including but not limited to any projections of earnings, revenue, expenses, cash repatriation, margins or other financial items; any statements of the plans, strategies, and objectives of management for future operations, including execution of any restructuring plans and remediation of execution issues; any statements concerning the expected development, performance or market share relating to products or services; any statements regarding future economic conditions or performance; any statements of expectation or belief; and any statements of assumptions underlying any of the foregoing. Risks, uncertainties and assumptions include macroeconomic and geopolitical trends and events; the outcome of pending legislation; execution and performance of contracts by suppliers, customers and partners; employee management issues; the challenge of managing asset levels, including inventory; the difficulty of aligning expense levels with revenue changes; assumptions related to pension and other post-retirement costs; and other risks that are described from time to time in HP's Securities and Exchange Commission reports, including but not limited to the risks described in HP's Quarterly Report on Form 10-Q for the fiscal quarter ended January 31, 2005 and other reports filed after HP's Annual Report on Form 10-K for the fiscal year ended October 31, 2004. HP assumes no obligation and does not intend to update these forward-looking statements.
HEWLETT-PACKARD COMPANY AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS
(Unaudited)
(In millions except per share amounts)
Three months ended
-----------------------------------
April 30, January 31, April 30,
2005 2005 2004(a)
----------- ----------- -----------
Net revenue $21,570 $21,454 $20,113
Costs and expenses:
Cost of sales 16,429 16,537 15,182
Research and development 890 878 924
Selling, general and
administrative 2,933 2,704 2,665
Amortization of purchased
intangible assets 151 167 148
Restructuring charges 4 3 38
Acquisition-related charges - - 9
In-process research and
development charge - - 9
----------- ----------- -----------
Total costs and expenses 20,407 20,289 18,975
----------- ----------- -----------
Earnings from operations 1,163 1,165 1,138
Interest and other, net (87) 25 2
Gains (losses) on investments 3 (24) (5)
Dispute settlement - (116) (70)
----------- ----------- -----------
Earnings before taxes 1,079 1,050 1,065
Provision for taxes 113 107 181
----------- ----------- -----------
Net earnings $966 $943 $884
=========== =========== ===========
Net earnings per share:
Basic $0.33 $0.32 $0.29
Diluted $0.33 $0.32 $0.29
Cash dividends declared per share $- $0.16 $-
Weighted-average shares used to
compute net earnings per share:
Basic 2,886 2,908 3,043
Diluted 2,917 2,936 3,081
(a) Certain reclassifications have been made to prior year amounts in
order to conform to the current year presentation.
HEWLETT-PACKARD COMPANY AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS
(Unaudited)
(In millions except per share amounts)
Six months ended
April 30,
---------------------
2005 2004(a)
---------- ----------
Net revenue $43,024 $39,627
Costs and expenses:
Cost of sales 32,966 29,873
Research and development 1,768 1,813
Selling, general and administrative 5,637 5,243
Amortization of purchased intangible assets 318 292
Restructuring charges 7 92
Acquisition-related charges - 24
In-process research and development charge - 9
---------- ----------
Total costs and expenses 40,696 37,346
---------- ----------
Earnings from operations 2,328 2,281
Interest and other, net (62) 13
(Losses) gains on investments (21) 4
Dispute settlement (116) (70)
---------- ----------
Earnings before taxes 2,129 2,228
Provision for taxes 220 408
---------- ----------
Net earnings $1,909 $1,820
========== ==========
Net earnings per share:
Basic $0.66 $0.60
Diluted $0.65 $0.59
Cash dividends declared per share $0.16 $0.16
Weighted-average shares used to compute
net earnings per share:
Basic 2,897 3,047
Diluted 2,926 3,086
(a) Certain reclassifications have been made to prior year amounts in
order to conform to the current year presentation.
HEWLETT-PACKARD COMPANY AND SUBSIDIARIES
NON-GAAP CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS
Excluding adjustments itemized below
(Unaudited)
(In millions except per share amounts)
Three months ended
-----------------------------------
April 30, January 31, April 30,
2005 2005 2004(a)
----------- ----------- -----------
Net revenue $21,570 $21,454 $20,113
Costs and expenses:
Cost of sales 16,429 16,537 15,182
Research and development 890 878 924
Selling, general and
administrative 2,933 2,704 2,665
----------- ----------- -----------
Total costs and expenses 20,252 20,119 18,771
----------- ----------- -----------
Non-GAAP earnings from operations 1,318 1,335 1,342
Interest and other, net (87) 25 2
Dispute settlement - (116) (70)
----------- ----------- -----------
Non-GAAP earnings before taxes 1,231 1,244 1,274
Provision for taxes 158 166 242
----------- ----------- -----------
Non-GAAP net earnings $1,073 $1,078 $1,032
=========== =========== ===========
Non-GAAP net earnings per share:
Basic $0.37 $0.37 $0.34
Diluted $0.37 $0.37 $0.34
Weighted-average shares used to
compute non-GAAP net earnings per
share:
Basic 2,886 2,908 3,043
Diluted 2,917 2,936 3,081
An itemized reconciliation between net earnings on a GAAP basis and
non-GAAP basis is as follows:
GAAP net earnings $966 $943 $884
Amortization of purchased
intangible assets 151 167 148
Restructuring charges 4 3 38
Acquisition-related charges - - 9
In-process research and
development charge - - 9
----------- ----------- -----------
Total non-GAAP adjustments to
earnings from operations 155 170 204
(Gains) losses on investments (3) 24 5
Income tax effect of reconciling
items (45) (59) (61)
----------- ----------- -----------
Non-GAAP net earnings $1,073 $1,078 $1,032
=========== =========== ===========
(a) Certain reclassifications have been made to prior year amounts in
order to conform to the current year presentation.
HEWLETT-PACKARD COMPANY AND SUBSIDIARIES
NON-GAAP CONSOLIDATED CONDENSED STATEMENT OF EARNINGS
Excluding adjustments itemized below
(Unaudited)
(In millions except per share amounts)
Six months ended
April 30,
---------------------
2005 2004(a)
---------- ----------
Net revenue $43,024 $39,627
Costs and expenses:
Cost of sales 32,966 29,873
Research and development 1,768 1,813
Selling, general and administrative 5,637 5,243
---------- ----------
Total costs and expenses 40,371 36,929
---------- ----------
Non-GAAP earnings from operations 2,653 2,698
Interest and other, net (62) 13
Dispute settlement (116) (70)
---------- ----------
Non-GAAP earnings before taxes 2,475 2,641
Provision for taxes 324 529
---------- ----------
Non-GAAP net earnings $2,151 $2,112
========== ==========
Non-GAAP net earnings per share:
Basic $0.74 $0.69
Diluted $0.74 $0.69
Weighted-average shares used to compute non-GAAP
net earnings per share:
Basic 2,897 3,047
Diluted 2,926 3,086
An itemized reconciliation between net earnings on a GAAP basis and
non-GAAP basis is as follows:
GAAP net earnings 1,909 1,820
Amortization of purchased intangible assets 318 292
Restructuring charges 7 92
Acquisition-related charges - 24
In-process research and development charge - 9
---------- ----------
Total non-GAAP adjustments to earnings
from operations 325 417
Losses (gains) on investments and other, net 21 (4)
Income tax effect of reconciling items (104) (121)
---------- ----------
Non-GAAP net earnings $2,151 $2,112
========== ==========
(a) Certain reclassifications have been made to prior year amounts in
order to conform to the current year presentation.
HEWLETT-PACKARD COMPANY AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
(In millions)
April 30, October 31,
2005 2004
----------- -----------
(unaudited)
ASSETS
Current assets:
Cash and cash equivalents $14,362 $12,663
Short-term investments 121 311
Accounts receivable, net 9,266 10,226
Financing receivables, net 2,720 2,945
Inventory 6,464 7,071
Other current assets 9,543 9,685
----------- -----------
Total current assets 42,476 42,901
Property, plant and equipment, net 6,669 6,649
Long-term financing receivables and other
assets 7,306 6,657
Goodwill and purchased intangibles, net 19,897 19,931
----------- -----------
Total assets $76,348 $76,138
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $8,583 $9,377
Notes payable and short-term borrowings 2,754 2,511
Employee compensation and benefits 1,860 2,208
Taxes on earnings 1,361 1,709
Deferred revenue 3,524 2,958
Accrued restructuring 122 193
Other accrued liabilities 10,211 9,632
----------- -----------
Total current liabilities 28,415 28,588
Long-term debt 4,397 4,623
Other liabilities 5,363 5,363
Stockholders' equity 38,173 37,564
----------- -----------
Total liabilities and stockholders' equity $76,348 $76,138
=========== ===========
HEWLETT-PACKARD COMPANY AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
(In millions)
Three Months Six Months
Ended Ended
April 30, April 30,
2005 2005
------------ ------------
Cash flows from operating activities:
Net earnings $966 $1,909
Adjustments to reconcile net earnings to
net cash provided by operating activities:
Depreciation and amortization 599 1,211
Provision for bad debt and inventory 90 223
(Gains) losses on investments (3) 21
Restructuring charges 4 7
Deferred taxes on earnings (53) 177
Other, net (37) (60)
Changes in assets and liabilities:
Accounts and financing receivables (438) 1,160
Inventory 564 366
Accounts payable 349 (794)
Taxes on earnings (78) (359)
Other assets and liabilities 436 155
Restructuring (25) (84)
------------ ------------
Net cash provided by operating
activities 2,374 3,932
------------ ------------
Cash flows from investing activities:
Investment in property, plant and
equipment, net (566) (1,141)
Proceeds from sale of property, plant and
equipment 186 342
Purchases of available-for-sale securities
& other investments (25) (1,703)
Maturities and sales of available-for-sale
securities & other investments 211 1,904
Net cash paid for business acquisitions,
net of acquisition costs (325) (332)
------------ ------------
Net cash used in investing activities (519) (930)
------------ ------------
Cash flows from financing activities:
(Decrease) increase in notes payable and
short-term borrowings, net (34) 77
Issuance of long-term debt 3 3
Payment of long-term debt (3) (14)
Issuance of common stock under employee
plans 90 352
Repurchase of common stock (618) (1,255)
Dividends (233) (466)
------------ ------------
Net cash used in financing activities (795) (1,303)
------------ ------------
Increase in cash and cash equivalents 1,060 1,699
Cash and cash equivalents at beginning of
period 13,302 12,663
------------ ------------
Cash and cash equivalents at end of period $14,362 $14,362
============ ============
HEWLETT-PACKARD COMPANY AND SUBSIDIARIES
SEGMENT INFORMATION
(Unaudited)
(In millions)
Three months ended
-----------------------------------
April 30, January 31, April 30,
2005 2005 2004(a)
----------- ----------- -----------
Net revenue:(a)
Imaging and Printing Group $6,390 $6,067 $6,098
Personal Systems Group 6,369 6,873 5,991
----------- ----------- -----------
Imaging and Personal Systems
Group 12,759 12,940 12,089
----------- ----------- -----------
Enterprise Storage and Servers 4,184 4,047 3,961
Software 277 240 225
HP Services 3,984 3,815 3,508
----------- ----------- -----------
Technology Solutions Group 8,445 8,102 7,694
----------- ----------- -----------
Financing 544 555 469
Corporate Investments 123 115 114
----------- ----------- -----------
Total segments 21,871 21,712 20,366
Eliminations of intersegment net
revenue and other (301) (258) (253)
----------- ----------- -----------
Total HP Consolidated $21,570 $21,454 $20,113
=========== =========== ===========
Earnings from operations:
Imaging and Printing Group $814 $932 $952
Personal Systems Group 147 147 44
----------- ----------- -----------
Imaging and Personal Systems
Group 961 1,079 996
----------- ----------- -----------
Enterprise Storage and Servers 184 71 119
Software (6) (40) (52)
HP Services 292 281 332
----------- ----------- -----------
Technology Solutions Group 470 312 399
----------- ----------- -----------
Financing 58 45 35
Corporate Investments (51) (51) (48)
----------- ----------- -----------
Total segments 1,438 1,385 1,382
Corporate and unallocated costs
and eliminations (120) (50) (40)
Restructuring charges (4) (3) (38)
Amortization of purchased
intangible assets (151) (167) (148)
Acquisition-related charges - - (9)
In-process research and
development charges - - (9)
Interest and other, net (87) 25 2
Gains (losses) on investments 3 (24) (5)
Dispute settlement - (116) (70)
----------- ----------- -----------
Total HP Consolidated Earnings
Before Taxes $1,079 $1,050 $1,065
=========== =========== ===========
(a) HP has added an aggregation of HP's Personal Systems Group and
Imaging and Printing Group to provide a supplementary view of HP's
business. In addition, HP has reflected certain fiscal 2005
organizational realignments on a backward-looking basis to provide
improved visibility and comparability. In any given quarter, no
segment's operating profit changed more than $8 million as a
result of these realignments, with typical movements ranging from
$3 million to $5 million.
HEWLETT-PACKARD COMPANY AND SUBSIDIARIES
SEGMENT INFORMATION
(Unaudited)
(In millions)
Six months ended
April 30,
---------------------
2005 2004(a)
---------- ----------
Net revenue:(a)
Imaging and Printing Group $12,457 $12,008
Personal Systems Group 13,242 12,178
---------- ----------
Imaging and Personal Systems Group 25,699 24,186
---------- ----------
Enterprise Storage and Servers 8,231 7,661
Software 517 428
HP Services 7,799 6,684
---------- ----------
Technology Solutions Group 16,547 14,773
---------- ----------
Financing 1,099 910
Corporate Investments 238 217
---------- ----------
Total segments 43,583 40,086
Eliminations of intersegment net revenue and
other (559) (459)
---------- ----------
Total HP Consolidated $43,024 $39,627
========== ==========
Earnings from operations:
Imaging and Printing Group $1,746 $1,919
Personal Systems Group 294 105
---------- ----------
Imaging and Personal Systems Group 2,040 2,024
---------- ----------
Enterprise Storage and Servers 255 272
Software (46) (101)
HP Services 573 593
---------- ----------
Technology Solutions Group 782 764
---------- ----------
Financing 103 64
Corporate Investments (102) (84)
---------- ----------
Total segments 2,823 2,768
Corporate and unallocated costs and
eliminations (170) (70)
Restructuring charges (7) (92)
Amortization of purchased intangible assets (318) (292)
Acquisition-related charges - (24)
In-process research and development charges - (9)
Interest and other, net (62) 13
(Losses) gains on investments (21) 4
Dispute settlement (116) (70)
---------- ----------
Total HP Consolidated Earnings Before Taxes $2,129 $2,228
========== ==========
(a) HP has added an aggregation of HP's Personal Systems Group and
Imaging and Printing Group to provide a supplementary view of HP's
business. In addition, HP has reflected certain fiscal 2005
organizational realignments on a backward-looking basis to provide
improved visibility and comparability. In any given quarter, no
segment's operating profit changed more than $8 million as a
result of these realignments, with typical movements ranging from
$3 million to $5 million.
HEWLETT-PACKARD COMPANY AND SUBSIDIARIES
SEGMENT / BUSINESS UNIT INFORMATION
(Unaudited)
(In millions)
Three months ended
-----------------------------------
April 30, January 31, April 30,
2005 2005 2004(a)
----------- ----------- -----------
Net revenue:(a)
Commercial Hardware $1,723 $1,611 $1,591
Consumer Hardware 1,019 1,114 986
Supplies 3,590 3,272 3,451
Other 58 70 70
----------- ----------- -----------
Imaging and Printing Group 6,390 6,067 6,098
----------- ----------- -----------
Desktops 3,520 3,802 3,468
Notebooks 2,212 2,338 2,011
Workstations 327 285 262
Handhelds 189 290 191
Other 121 158 59
----------- ----------- -----------
Personal Systems Group 6,369 6,873 5,991
----------- ----------- -----------
Imaging and Personal Systems
Group 12,759 12,940 12,089
----------- ----------- -----------
Business Critical Systems 991 899 972
Industry Standard Servers 2,368 2,328 2,107
Storage 825 820 882
----------- ----------- -----------
Enterprise Storage and Servers 4,184 4,047 3,961
----------- ----------- -----------
OpenView 183 154 135
OpenCall & Other 94 86 90
----------- ----------- -----------
Software 277 240 225
----------- ----------- -----------
Technology Services 2,464 2,389 2,219
Managed Services 771 754 609
Consulting & Integration 749 672 681
Other - - (1)
----------- ----------- -----------
HP Services 3,984 3,815 3,508
----------- ----------- -----------
Technology Solutions Group 8,445 8,102 7,694
----------- ----------- -----------
Financing 544 555 469
Corporate Investments 123 115 114
----------- ----------- -----------
Total segments 21,871 21,712 20,366
----------- ----------- -----------
Eliminations of intersegment net
revenue and other (301) (258) (253)
----------- ----------- -----------
Total HP Consolidated $21,570 $21,454 $20,113
=========== =========== ===========
(a) HP has added an aggregation of HP's Personal Systems Group and
Imaging and Printing Group to provide a supplementary view of HP's
business. In addition, HP has reflected certain fiscal 2005
organizational realignments on a backward-looking basis to provide
improved visibility and comparability. In any given quarter, no
segment's operating profit changed more than $8 million as a
result of these realignments, with typical movements ranging from
$3 million to $5 million.
HEWLETT-PACKARD COMPANY AND SUBSIDIARIES
SEGMENT / BUSINESS UNIT INFORMATION
(Unaudited)
(In millions)
Six months ended
April 30,
------------------------
2005 2004(a)
------------ -----------
Net revenue:(a)
Commercial Hardware $3,334 $3,138
Consumer Hardware 2,133 2,262
Supplies 6,862 6,477
Other 128 131
------------ -----------
Imaging and Printing Group 12,457 12,008
------------ -----------
Desktops 7,322 6,984
Notebooks 4,550 4,153
Workstations 612 497
Handhelds 479 444
Other 279 100
------------ -----------
Personal Systems Group 13,242 12,178
------------ -----------
Imaging and Personal Systems Group 25,699 24,186
------------ -----------
Business Critical Systems 1,890 1,887
Industry Standard Servers 4,696 4,066
Storage 1,645 1,709
Other - (1)
------------ -----------
Enterprise Storage and Servers 8,231 7,661
------------ -----------
OpenView 337 268
OpenCall & Other 180 160
------------ -----------
Software 517 428
------------ -----------
Technology Services 4,853 4,309
Managed Services 1,525 1,133
Consulting & Integration 1,421 1,241
Other - 1
------------ -----------
HP Services 7,799 6,684
------------ -----------
Technology Solutions Group 16,547 14,773
------------ -----------
Financing 1,099 910
Corporate Investments 238 217
------------ -----------
Total segments 43,583 40,086
------------ -----------
Eliminations of intersegment net revenue
and other (559) (459)
------------ -----------
Total HP Consolidated $43,024 $39,627
============ ===========
(a) HP has added an aggregation of HP's Personal Systems Group and
Imaging and Printing Group to provide a supplementary view of HP's
business. In addition, HP has reflected certain fiscal 2005
organizational realignments on a backward-looking basis to provide
improved visibility and comparability. In any given quarter, no
segment's operating profit changed more than $8 million as a
result of these realignments, with typical movements ranging from
$3 million to $5 million.
Contact:
HP Robert Sherbin, 650-857-2381 Email Contact Ryan J. Donovan, 650-857-8410 Email Contact HP Media Hotline, 866-266-7272 Email Contact www.hp.com/go/newsroom